Days Payable Outstanding - DPO

Days Payable Outstanding - DPO

A company's average payable period. Calculated as:





Notice that the formula may also be written as: accounts payable / (cost of sales/number of days).

Notes:

DPO is an indicator of how long a company is taking to pay its trade creditors. DPO is typically looked at either quarterly or yearly (90 or 365 days).

See also: Accounts Payable, Accounts Receivable, Days Sales Outstanding - DSO